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Clean air projects seen as growth market in Brazil

Date: 01-Aug-02
Country: BRAZIL
Author: Peter Blackburn

The Kyoto pact, inspired by the 1992 Earth Summit in Rio de Janeiro and signed in Kyoto, Japan in 1997, aims to cut emissions of greenhouse gases, such as carbon dioxide and methane, that raise temperatures.

Industrialized country members must cut their emissions by an average 5 percent between 2008-2112. Those unable to do so can buy carbon credits - giving the right to pollute - from countries, such as Brazil, that have pollution space.

The 15-nation European Union and Japan have ratified the Kyoto pact but the U.S., the world's biggest polluter hasn't.

"Carbon credit trading is 4 to 5 times greater this year than expected," Nuno Cunha e Silva, Director of Ecosecurities told Brazil's 2nd Clean Energy Forum in Rio de janeiro, adding that he expected global turnover to reach $10 billion by 2005.

Silva said there were small scale biomass, wind and solar energy projects, as well as reforestation and urban waste energy schemes being prepared in Brazil. Biomass is plant and animal matter used to produce power.

PIG IRON POWER PROJECT

The first Brazilian project financed by the World Bank's Prototype Carbon Fund was signed this month, said Werner Kornexl, the Bank's Brasilia-based private sector development expert.

The Plantar pig iron project in Minas Gerais state involves the substitution of local charcoal for imported coke as an energy source in the steel production process.

"It's small but profitable and brings in foreign capital, social and environmental benefits," Kornexl told Reuters after the two-day conference closing this week.

By using charcoal produced from nearby eucalyptus plantations, the project avoids air pollution caused by burning coke and also generates 4,000 jobs.

Kornexl added that a couple more renewable energy projects in Brazil's two largest cities, Sao Paulo and Rio de Janeiro, were likely to be finalized later this year. Power is generated by burning methane gas seeping from urban waste landfills.

"Things are happening very quickly here in renewable energy," Kornexl said, noting that new projects brought in new technology.

Brazil's Koblitz company started up a 10 MW wood-waste fired electricity power station at Piratini in Rio Grande do Sul late last year.

"We're selling carbon credits in a very small way to a Canadian company," Koblitz's commercial manager Marcilio Reinaux Jr. told Reuters.

The 10 million reais ($2.9 million) power plant is supplied with wood-waste by local saw mills logging industrial pine plantations.

"About 40 percent of the trees are waste," Reinaux said.

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